Many of Santa Monica’s older apartment buildings lack individual water meters and some local officials want to discuss new rules to force property owners into upgrading their water systems.
Rent Control Board Commissioner Todd Flora has asked for a discussion at the board’s Feb. 9 meeting to debate a citywide mandate to outlaw Ratio Utility Billing Systems and require landlords to move to submeters as the means of establishing water costs. Flora’s request is to discuss the subject and then ask City Council to adopt new rules if the rest of the board agrees with his concerns.
In buildings with submeters, individual units are responsible for the water they use. A reduction in use by a tenant equals a direct reduction in their bill. However, in a RUBS building all tenants share a master meter. The property owner establishes a system for dividing the total water use among the tenants. Any savings that result from an individual user’s conservation efforts are shared among the entire building.
According to the staff report, the ratio system does not incentivize water saving and the practice has already been outlawed in some states. California does not have a statewide policy but local jurisdictions can restrict its use.
“As a jurisdiction that has been dedicated to water conservation, Santa Monica should discourage, if not outright forbid, RUBS billing,” said the staff report. “First, there is little sense in allowing the practice, when it undeniably removes any incentive that landlords might have to save water, since it allows them to pass through the cost of wasteful water usage to tenants. But second, and more fundamentally, allowing RUBS would remove any incentive that the owner of an existing multi-family building might have to implement the water-saving submetering system that state law now encourages. After all, why bear the expense of buying and installing submeters if the property owner can get the same money savings by simply passing water charges through to tenants, regardless of how much water specific tenants actually use.”
Flora said asking for the discussion was a natural extension of dual commitment to the environment and housing protections.
“Metering for water, or ‘submetering’ for multi-family housing as it’s known, is a powerful water conservation tool,” he said. “It allows users to see how much they are using in their individual unit, makes them responsible for the charges, and encourages them to adjust their habits accordingly. But ‘ratio utility billing,’ or RUBS, has nothing to do with encouraging conservation, and everything to do with simply extracting more money from renters. Therefore, I believe we need to put a stop to it before the practice takes hold.”
Staff said the issue impacts all apartments in the city but has an additional implication for rent controlled units.
“Members of Action Apartment Association have recently expressed the intent to avoid rent limitations by utilizing RUBS to segregate their overhead for water from other rent so that they can pass any increases in their water costs directly to their tenants, regardless of how much water any tenant actually uses,” said the report.
Action Apartment Association sued the board in 2016 alleging the board lacked the authority regulate RUBS. The complaint was dismissed but it could be amended in the future.
“Given that Action’s latest theory appears to be that the Board has no authority to address RUBS billing, and given the likelihood that Action will continue try to find some way to sue the Board on that theory, it is Commissioner Flora’s view that the Board should recommend that City Council, whose police power is broader than that of the Board and undoubtedly extends to enacting water-conservation measures, do what Action asserts that the Board cannot, and forbid RUBS billing within the City of Santa Monica,” said the report.
The report said a citywide ban on RUBS could make the city’s enforcement options more efficient for water wasters. Under current rules, the property owner receives a fine if a master metered building exceeds its water conservation goals. The board has not allowed those fees to be passed directly to tenants but according to the report, if submeters were installed in every unit, the individual water waster would be fined and therefore, more likely to conserve.
Staff are recommending the board discuss the issue and if they agree to move forward, send information to the City Council requesting additional action.
While Rent Control staff are in frequent communication with City staff, the two elected bodies do not often request each other’s help. Flora said the Board’s requests are usually related to significant policy issues and he said he has confidence that Council will take up a discussion on RUBS.
“In the past couple years, the Board has brought to the City Council's attention issues related to relocation fees and tenant harassment, which led to the Council significantly strengthening the City’s Tenant Harassment Ordinance,” he said. Also in my time as a Commissioner, the Board has worked with the City Council on issues related to smoking inside rental units, and just months ago asked the city to consider conducting a study on what factors encourage owners to Ellis their properties with an eye toward determining whether there are actions the Council might take that would encourage owners to remain in the rental market.”
The Rent Control Board will meet on Feb. 9 at 6 p.m. in City Hall, 1685 Main St.
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